A recent report by the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are directing patients towards pricier medications while restricting their options for where to obtain them. The report, reviewed by the Wall Street Journal, stemmed from a 32-month investigation and precedes a hearing featuring executives from the largest PBMs in the U.S.
PBMs act as intermediaries between health insurers and drug manufacturers, negotiating prices on behalf of health plans. They also determine the out-of-pocket expenses patients encounter when filling prescriptions. The three major PBMs—Express Scripts, OptumRx, and Caremark—collectively manage around 80% of prescriptions across the country.
According to the committee’s findings, these PBMs have developed preferred drug lists that prioritize higher-priced brand-name medications over more affordable alternatives. The report highlighted internal communications from Cigna, which discouraged opting for cheaper substitutes for Humira, a treatment for arthritis costing $90,000 annually, despite a biosimilar available for about half that price.
Additionally, the committee noted that Express Scripts informed patients they would incur higher costs by filling prescriptions at local pharmacies compared to using its affiliated mail-order service. This practice effectively limits patient choices.
Earlier this month, the U.S. Federal Trade Commission (FTC) released a similar report, indicating that the increasing concentration in the PBM market has allowed the six largest PBMs to manage nearly 95% of all U.S. prescriptions. The FTC’s findings are concerning, as they suggest that the dominant PBMs exert considerable influence over the accessibility and affordability of prescriptions for Americans.
FTC Chair Lina M. Khan emphasized that the middlemen are substantially inflating costs for patients, particularly for cancer medications, resulting in profits exceeding $1 billion.